This ASX ETF is up 21% in April so far

How on earth has this ETF smashed the market by a factor of 10?

| More on:
ETF written in gold with dollar signs on coin.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The ASX 200 has had a very pleasing month in April thus far
  • Since the start of the month, ASX shares have risen by a healthy 2.4%
  • But one ASX ETF has almost 10 timed the broader market 

It's not too often an ASX exchange-traded fund (ETF) rises 21% in an entire year. But 21% over just one month? That is a rare occurrence indeed. 

Sure, April has been a great month for ASX shares and, by extension. many ASX ETFs as well. As it currently stands, the S&P/ASX 200 Index (ASX: XJO) is up a healthy 2.4% in April so far.

But let's talk about the BetaShares Crypto Innovators ETF (ASX: CRYP).

Crypto Innovators units were going for $2.33 each at the start of April. But today, this ASX ETF is asking $2.83 per unit. That means that this ETF has gained a whopping 21.5% or so over the past two-and-a-half weeks. That's a gain that exceeds the returns of the ASX 200 by almost ten-fold.

So what on earth is going on here that has allowed this ETF to give its investors such a lucrative return in such a short space of time, no less?

Well, to answer that, let's dig into what this ETF invests in.

The BetaShares Crypto Innovators ETF is a fund that is designed to track a basket of global companies that are all involved in the cryptocurrency sector.

We've all heard of cryptocurrencies like Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH). But with the crypto market maturing, there are now a bevvy of companies that facilitate the creation, exchange and use of these digital assets.

According to BetaShares, this fund "provides 'picks and shovels' exposure to the companies building crypto mining equipment, crypto trading venues, and other key services that allow the crypto economy to thrive".

Some of the companies that this ETF is invested in include Riot Blockchain, Microstrategy Inc, Galaxy Digital Holdings Ltd and Coinbase Global Inc.

Why has this ASX cryptocurrency ETF risen 21% in April?

Since most of these companies derive their earnings from the cryptocurrency markets, their fortunes rise and fall alongside the markets of cryptocurrencies like Bitcoin and Ethereum themselves.

And over the past few months, cryptocurrencies have seen a dramatic resurgence in value. Just take the flagship crypto Bitcoin. It was only back in late December that Bitcoin was going for just US$16,500 each.

But today, that same digital token will set an investor back US$29,500. Yes, Bitcoin is up a whopping 77.5% in 2023, including by 9.15% over the past month alone. It's a similar story with Ethereum and many other cryptocurrencies.

So with gains like this, it's no wonder that the companies that are in these assets' orbit are also seeing their valuations shoot through the roof.

To illustrate, Riot Blockchain stock is up a whopping 283% in 2023, and by almost 30% in April so far. Coinbase shares have risen by more than 100% in 2023, as has Microstrategy stock.

So it's not hard to see why this ASX ETF is adding so much value recently. As long as cryptocurrency prices continue to surge, we can probably expect this ASX ETF to keep climbing too.

But don't get too starry-eyed. The BetaShares Crypto Innovators ETF, while on fire lately, still remains down by more than 44% over the past year,  and by close to 80% since the all-time highs of $12 a share that we saw in late 2021:

Motley Fool contributor Sebastian Bowen has positions in Bitcoin, Coinbase Global, and Ethereum. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Betashares Crypto Innovators ETF, Bitcoin, Coinbase Global, and Ethereum. The Motley Fool Australia owns and has recommended Bitcoin and Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on ETFs

The letters ETF sit in orange on top of a chart with a magnifying glass held over the top of it

Meet the ASX's new NASDAQ ETFs

The ASX has just seen its Nasdaq ETF count double.

Read more »

child in superman outfit pointing skyward, indicating a rising share price

Is the Vanguard Australian Shares Index ETF (VAS) a good buy for beginners?

Should new investors start with the VAS ETF?

Read more »

A businessman holding a world globe in one hand, representing global investment.

These ASX ETFs could be world class options in February

These ETFs could give your portfolio a boost in 2024. Here's what you need to know about them.

Read more »

Woman on her phone with diagrams of tech sector related elements linking with each other.

Here are 3 exciting ASX tech ETFs to buy right now

These ETFs give investors access to some quality tech stocks.

Read more »

A smiling little boy helps his father plant a tree, indicating that big things grow from a small beginning.

I'm planning to buy this top ASX ETF for my child

This investment ticks many of the boxes I’m looking for.

Read more »

A group of young ASX investors sitting around a laptop with an older lady standing behind them explaining how investing works.

Buy and hold these ASX ETFs for 10 years or more

These ETFs could be top long term investments. But what are you buying?

Read more »

a couple clink champagne glasses on board a private aircraft with gourmet food plates set in front of them. They are wearing designer clothes and looking wealthy.

How this rocketing ASX ETF is tapping into the billionaire-making AI revolution

The AI revolution has added billions more dollars to the fortunes of dozens of billionaires in 2024.

Read more »

Suncorp share price Businessman cheering and smiling on smartphone

3 ASX ETFs for smart investors to buy

These ETFs have delivered strong returns for unitholders.

Read more »